5. 12.10 The Lee Company of Westbrook, Connecticut, manufactures pressure relief inserts for use where zero leakage is required. A machine purchased 3 years ago has been book depreciated by the straight line method using a 5-year useful life. The book value at the end of year 3 is $30,000, and the company assumed that the machine would be worthless at the end of its 5-year useful life.

(a) What is the book depreciation charge each year, and

(b) what was the basis for depreciation purposes?

(c) (Spreadsheet exercise) Use the SLN function to plot the book value for 5 years if S = 0, as assumed above, and if S is 15% of the basis.